Conduct some research to explain the value of cost classifications for TFC and how this may...

Conduct some research to explain the value of cost classifications for TFC and how this may assist Tomohiro in improving their decision-making processes.

Conduct some research into costing techniques that TFC might find useful.Based on this research and using the detail in the case, choose a specific technique (or set of techniques) that you believe would be most suitable. Describe specifically how your chosen technique(s) could be used by providing tangible examples of how they would operate within TFC. It should be clear from these examples how TFC would determine a product cost for their products. Also, briefly describe why you consider your chosen technique(s) to be superior to other techniques.

(Please note:you are not required to actually calculate any costs here, just outline how costing could be done differently. Therefore, you may wish to provide a table or diagram outlining the operation of your proposed costing technique(s).

Using the detail in the case, describehowyour chosen method of calculating product cost will be beneficial within TFC and have relevance to management.

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ACC/ACF2200 Introduction to Management Accounting
2018-S1 Assignment
Tea Factory Company (TFC)
It is a typical winter’s day in Melbourne. In his river view office, Tomohiro Hasegawa, CEO
of TFC, is having a sip of his tea while reading the
quarterly financial report of the company. As usual,
Tomohiro enjoys the indulgence of his favourite drink.
Indeed, the love of tea is the very reason that the former
Professor of Marketing gave up his six-figure job to start his
own business in 1995.
With a humble beginning at the granny flat in the backyard of Tomohiro’s Wantirna South
house, TFC emerged as a major manufacturer of tea-based drinks and desserts in Australia.
Tomohiro’s vision is to establish the company as a premier brand in the Australian tea-based
product market. The company produces and sells iced tea drinks, tea-flavoured ice cream and
tea-flavoured confectioneries.
The market faced by TFC is dynamic and highly competitive. Driven by growing interest in
healthy ready-to-drink beverages and the increasing health consciousness among baby boomers
and younger adults, TFC enjoyed a fourfold increase in sales between 2011 and 2017. However,
the company faces fierce competition from new local and international competitors for retail
shelf space in supermarkets and other retail outlets. TFC’s competitors offer fast delivery from
local production center’s and/or lower prices in their bid for shelf space. Without sustaining its
hardly earned share of shelf space in retail outlets, TFC cannot maintain its momentum.
To tackle the challenges posed by its competitors, TFC places a strong emphasis on
research and development. The company has a 15-person research team in its headquarters.
The research team maintains close working relationships with CSIRO Food and Nutritional
Sciences and the University of Melbourne and has a good track record in developing successful
new products for the company. Some of TFC’s new...

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